Third Way Democrats Are Bought and Sold by The Kochs

When George Soros and Charles Koch announced in July that they are partnering to create a think tank dedicated to ending the United States’ forever wars, Steven Kinzer of The Boston Globe called the idea “one of the most remarkable partnerships in modern American political history.”

Despite the jarring image of the liberal billionaire joining forces with the radical conservative, the forthcoming Quincy Institute for Responsible Statecraft is not such an anomaly in the history of the Koch family. As Ryan Grim and Andrew Perez explain in a joint report from The Intercept and Maplight, in 2007, Koch Industries “secretly financed a report by Third Way, a corporate-funded think tank with ties to the centrist wing of the Democratic Party.”

Grim and Perez’s reporting is based on research from a new book, “Kochland,” by Christopher Leonard, an investigative reporter.

In 2007, Third Way and Koch Industries were concerned that public opinion among Democrats and Republicans was turning against free trade. Right-wing CNN anchor Lou Dobbs railed against it, and so were many congressional Democrats. George W. Bush managed to ram the Central American Free Trade Agreement through Congress with Republican votes in 2005, but prospects for future free trade deals were looking grim.

So Third Way issued a white paper titled “Why Lou Dobbs is Winning,” which was, as Leonard, Grim and Perez report, created with Koch funding, a fact that was not immediately obvious.

Grim and Perez observe that Koch Industries is not directly thanked in the white paper’s acknowledgements. Rather, they report, it “[offered] thanks to Rob Hall, then a lobbyist for Koch Industries’ Invista division, ‘for his support in helping us conceive of and design Third Way’s trade project.’”

The report contained an additional message in the acknowledgements, Leonard writes in “Kochland”: “The authors offer their sincerest thanks to Third Way’s Board of Trustees for their continuing intellectual support of Third Way and in particular for providing several of the key initial insights on which this paper is built.”

As Grim and Perez report, “Third Way’s board of trustees is a who’s who of Wall Street and corporate elites.”

The white paper aimed to change the conversation around trade policy, and warned of “a new and powerful populist strain [that] has emerged on both the left and the right of American politics that threatens to turn the nation fearful and inward,” Grim and Perez write.

According to The Intercept, the paper was part of a larger project “to sell free trade policies to Democratic politicians, laid out a series of prescriptions to reframe the debate.”

In the white paper, Third Way argues that Americans distrusted free trade because it costs low-income and middle-class Americans their jobs, and only benefits giant corporations. The report concedes that Americans have reason to be wary: “Middle-class economic anxiety is widespread and legitimate. And fairly or not, much of the blame for this anxiety is landing squarely on trade.”

The white paper’s aim of promoting free trade among Democrats was successful, to the extent that the Obama administration was friendly toward free trade, and entered the United States into the 12-country Trans-Pacific Partnership (which Donald Trump later pulled out out of). In the lead-up to the 2020 election, Democratic presidential candidates Elizabeth Warren and Bernie Sanders both oppose the TPP. Third Way, despite fighting Warren in the past, says she’s more palatable than Sanders.

Third Way is not the only centrist Democrat organization the Kochs have cozied up to when it was economically beneficial for both sides. As Grim and Perez explain, Hall, who was thanked in Third Way’s report, also was involved in the Democratic Leadership Council:

A 2001 American Prospect investigation noted that Koch Industries was a member of the executive council of the Democratic Leadership Council, founded in 1985 by centrist Democrats to combat the left inside the party. Hall, thanked in the report, was a member of the DLC’s event committee at the time.

Both Third Way and Koch Industries declined to comment to The Intercept.